When I was in Shanghai in the fall of 2003, I met with Jack Ma, the fast speaking Chinese entrepreneur who founded Alibaba.com. At the time, as we met atop the world's tallest hotel, the Grand Hyatt Shanghai in the Jin Mao Tower, Alibaba's chief business was an online supply-chain platform that connects China's many thousands of manufacturers, component and commodity handlers, and import-exporters. Now Alibaba also competes with eBay with a consumer online auction site and online payments (a la PayPal).
Today, Yahoo! is paying $1 billion for a 35 percent stake in Alibaba and will turn its Chinese operations over to Alibaba. eBay and Barry Diller's Interactive Corp. had already made deals to enter the Chinese ecommerce market. Last Friday, China's Google-like Baidu.com went public in a 1999-like rocket IPO approaching $1 billion but has since settled to a market cap of around $390 million.
Also today, China announced a few small steps in currency and capital liberalization and said its new basket of currencies against which it values the yuan includes the dollar, yen, euro, and won. It didn't, however, reveal the weights.
Our economies become more seamless all the time.